If a Bank Has Excess Reserves of $20,000 and Demand

question 137

Multiple Choice

If a bank has excess reserves of $20,000 and demand deposit liabilities of $80,000,and if the reserve requirement is 20 percent,then the bank has total reserves of

• A)$16,000.
• B)$20,000.
• C)$26,000.
• D)$36,000.

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Definitions:

Advertising

The activity or profession of producing advertisements for commercial products or services, aiming to influence consumer behavior and preferences.

Elasticity of Demand

A measure of how much the quantity demanded of a good responds to a change in the price of that good, with elasticity greater than one indicating elastic demand.

Brand Names

The names given to products or services by companies to distinguish them in the market and build company identity.

Product Quality

The degree to which a product or service meets customer expectations and requirements.